Although some premium rigs have been reactivated recently, it is anticipated that the energy markets will be slow to recover. Floating rig growth is expected to be to the tune of 6 % per annum between 2019 and 2027 as per McKinsey Company. Key growth regions will be Africa, Brazil, and the Gulf of Mexico. FPSO market will continue its growth with Brazil and Africa driving most of the demand for tonnage and E&P (Exploration & Production) activity. The actual number of FPSOs set to hit the market, between 2019 and 2022 will be 33 new vessels worldwide. We also see a large potential in the Middle East due to ageing offshore fleets owned and operated by regional contractors and oil majors.
Expectations for continued moderate offshore market improvements in 2020 have been re-placed by a significant downturn in sentiment following firstly major disruption from the evolving COVID-19 pandemic, and then the collapse of OPEC+ talks, which have led to a sharp fall in oil prices and the development of a of fluid and significantly uncertain situation. Forecasts for offshore FIDs this year have been cut significantly, to close to the 2016 level. Operational challenges for the offshore industry are also growing, whilst strategic transactions (including S&P, FIDs, drilling campaigns etc) are slowing and are more vulnerable. New-building order potential, already weak, now looks set to be even lower (aside from off shore wind related activity). Overall, the short-term looks likely to represent a challenging period for the offshore industry.
In this difficult environment, Subsea Global Solutions has been supporting its clients operating in this industry through generating direct savings in scheduled thruster overhauls and repairs, their de-mounting and re-mounting via our proprietary technology thereby minimizing the cost and time required. We also perform strategic, long term life-time extension repair projects on older FPSOs, helping our clients to extend the useful utilization time of their assets (via fully class approved permanent wet-welding techniques) and avoiding allocation of high capex budgets for asset renewals.
We proudly serve a broad range of clientele including the leading oil majors, offshore contractors, drilling rig / semi-sub operators, FPSO owners, state owned oil companies etc.